Q: I have a question regarding a specific circumstance that involves extended warranty. When buying a cell phone is it permissible to by extended warranty in the following circumstances:
1. Pay $10 a month and if you lose or break your phone you can get a new one. Plus every six months you can Reade in your old phone pay the difference and get a new one.
2. Pay $100 for two year plan that only includes manufacture defects over that period. If you don’t use it you get $100 back as in store credit after 2 years.
1. This is not permissible. It comes under the ambit of the Islamic definition of gambling.
2. This is permissible. You may also refer to other ulama.
And Allah Ta’ala (الله تعالى) knows best.